1	2Q 2009 Earnings Call July 28, 2009 Presenters: Harold McGraw III Chairman, President and CEO Robert J. Bahash Executive Vice President and CFO Donald S. Rubin Senior Vice President, Investor Relations
2	Donald S. Rubin Senior Vice President, Investor Relations The McGraw-Hill Companies
3	“Safe Harbor” Statement Under The Private Securities Litigation Reform Act of 1995 This presentation includes certain forward-looking statements about the Company’s businesses and our prospects, new products, sales, expenses, tax rates, cash flows, prepublication investments and operating and capital requirements. Such forward-looking statements include, but are not limited to: the strength and sustainability of the U.S. and global economy; the duration and depth of the current recession; Educational Publishing’s level of success in 2009 adoptions and in open territories and enrollment and demographic trends; the level of educational funding; the strength of School Education including the testing market, Higher Education, Professional and International publishing markets and the impact of technology on them; the level of interest rates and the strength of the economy, profit levels and the capital markets in the U.S. and abroad; the level of success of new product development and global expansion and strength of domestic and international markets; the demand and market for debt ratings, including collateralized debt obligations (“CDO”), residential and commercial mortgage and asset-backed securities and related asset classes; the continued difficulties in the credit markets and their impact on Standard & Poor’s and the economy in general; the regulatory environment affecting Standard & Poor’s; the level of merger and acquisition activity in the U.S. and abroad; the strength of the domestic and international advertising markets; the strength and the performance of the domestic and international automotive markets; the volatility of the energy marketplace; the contract value of public works, manufacturing and single-family unit construction; the level of political advertising; and the level of future cash flow, debt levels, manufacturing expenses, distribution expenses, prepublication, amortization and depreciation expense, income tax rates, capital, technology, restructuring charges and other expenditures and prepublication cost investment. Actual results may differ materially from those in any forward-looking statements because any such statements involve risks and uncertainties and are subject to change based upon various important factors, including, but not limited to, worldwide economic, financial, political and regulatory conditions; currency and foreign exchange volatility; the health of debt and equity markets, including interest rates, credit quality and spreads, the level of liquidity, future debt issuances including residential and commercial mortgage-backed securities and CDOs backed by residential mortgages and related asset classes; the implementation of an expanded regulatory scheme affecting Standard & Poor’s ratings and services; the level of funding in the education market (both domestically and internationally); the pace of recovery in advertising; continued investment by the construction, automotive, computer and aviation industries; the successful marketing of new products, and the effect of competitive products and pricing.
4	Harold McGraw III Chairman, President and CEO The McGraw-Hill Companies
5	MHP 2Q 2009 results EPS 2Q 2009: $0.52 Includes $0.06 for a net restructuring charge and a loss on a divestiture Revenue 2Q 2009: Declined 12.4% to $1.5 billion compared to 2Q 2008
6	Signs of economic improvement States’ budget pressures persist Still see challenges in school market Encouraging economic activity: Improving flow of credit is helping lay groundwork for recovery Spreads are narrowing and should continue to tighten Money managers and insurance companies putting money to work Renewed investor interest in non-financial investment-grade bonds and speculative-grade instruments
7	2Q: Took steps to prepare for future $0.03 restructuring charge for workforce reduction of approximately 550 positions Key step: Combining supplemental and basal operations and reduction of approximately 340 positions at McGraw-Hill Education Sold Vista Research Resulted in pre-tax loss of $13.8 million, or $0.03 per diluted share Exploring strategic options for BusinessWeek
8	McGraw-Hill Education Financial Services Information & Media
9	McGraw-Hill Education: Tale of two markets 2009: Declining sales in elementary-high school market Sustained growth in the U.S. college and university market Both trends were evident in 2Q performance Will also be factors in our second half 2009 results
10	2Q 2009 segment results at McGraw-Hill Education Revenue (17.2%) to $555.2 million School Education Group: (22.7%) to $338.6 million Higher Education, Professional and International Group: (6.9%) to $216.6 million Operating Profit Declined by 70.1% to $21.0 million Includes a net pre-tax restructuring charge of $11.6 million Operating Margin 3.8%
11	Challenges in elementary-high school market State budgets for education are under pressure Substantial cut backs in historic buying levels in adoption states Reducing estimate for the 2009 state new adoption market to $500 million–$550 million range Had been forecasting $550 million to $600 million Without benefit of federal stimulus funds, el-hi market could decline by 15% to 20% this year
12	Outlook for 2009 state new adoption market More state-level postponements not expected Could be school district level postponements in economically stressed states like California We expect to perform well in state new adoption market Reading: California, Louisiana Math: California, South Carolina, Kentucky and Oregon Science: Tennessee Social studies: Indiana We estimate a capture rate of 30% of total available dollars in this year’s state new adoption market
13	Mixed outlook for testing market Acuity continues to win new adoptions and renewals Our online formative assessment program Gains in formative market offset by declines in custom and off-the-shelf products
14	A strong start in U.S. college and university market Improving revenue outlook in higher education Increasing our forecast for 2009 Now expect market to grow 5% to 7% Previously forecasted 3% to 4% growth We will benefit from: Solid new publications list for all four imprints Successful new digital offerings Higher enrollments last fall and this spring Indications that enrollments will grow again this fall
15	Gauging the impact of a declining el-hi market in 2009 Reducing 2009 revenue guidance for the McGraw-Hill Education segment Now expect revenue to decline 8.5% to 9.5% Previously forecasted a 7% to 8% decrease
16	Why we expect outlook for education to improve in 2010 Comparisons will get easier Benefits of recent restructuring will be realized We expect to operate more efficiently and to lower development costs Growing lineup of digital products will produce more growth Federal stimulus funds will make a difference State new adoption calendar improves in 2010 Growing enrollments
17	Why we expect outlook for education to improve in 2010 Comparisons will get easier next year School Education Group’s revenue is off 20.1% for first half 2009 Expect rate of decline to diminish in second half Easier comparisons in 2010
18	Why we expect outlook for education to improve in 2010 Benefits of restructuring in el-hi business Will begin to see benefits in second half of 2009 More to be realized in 2010 Combined basal and supplemental school operations streamlines our pre-K–12 organization $11.6 million net restructuring charge for approximately 340 positions in this segment
19	Why we expect outlook for education to improve in 2010 Lowering development costs and reducing time-to-market will improve operating effectiveness and revenue potential Increasing focus on growth areas such as intervention and college and career readiness Streamlining product creation in four learning solution centers
20	Why we expect outlook for education to improve in 2010 Integration of content, technology and distribution offers growth opportunities We will be increasingly digital in: School market Testing Higher education Professional
21	Why we expect outlook for education to improve in 2010 New Center for Digital Innovation to create same digital environment in classrooms that is emerging outside school
22	Why we expect outlook for education to improve in 2010 $25.2 billion available for Title I and IDEA programs Could make a meaningful difference in some states and some product categories in second half 2009 Federal stimulus money is moving into states but slowly into districts As of July 24, $29 billion in funding had been approved for 44 states, the District of Columbia, and Puerto Rico First wave of stabilization funding is expected to be used to cover shortfalls and save teaching jobs in 2009, rather than new purchases
23	Why we expect outlook for education to improve in 2010 We expect a solid list of stimulus-funded adoptions in 3Q and 4Q Administration’s focus on real-time assessments and multiple measures will provide new opportunities for Acuity Stimulus package will have greater impact on el-hi market in 2010 than in 2009 Federal stimulus contains provisions with positive implications for postsecondary education Pell Grants: Maximum increased Work-Study Programs: Increased support
24	Why we expect outlook for education to improve in 2010 An improved state new adoption calendar in 2010: Estimate about $950 million to $1 billion Market should benefit from: Increased availability of stimulus funds Implementation of 2009 postponements in 2010 Return of Texas to market for K–12 reading/literature adoption (program has been funded by state legislature) Florida K–12 math opportunity looks solid in 2010 State needs new textbooks correlated to new state standards
25	Why we expect outlook for education to improve in 2010 Pre-K–16 enrollments are growing, according to National Center for Education Statistics 56.4 million el-hi students in 2010 18.6 million students in U.S. higher education
26	2009 outlook for McGraw-Hill Education Before the benefits of the federal stimulus package: 15% to 20% decline in the elementary-high school market 5% to 7% increase in the U.S. college and university market For the segment in 2009: 8.5% to 9.5% decline in revenue 300 to 400 basis point decline in operating margin, excluding 2008 and 2009 restructuring charges Implies a 9% to 10% operating margin
27	McGraw-Hill Education Financial Services Information & Media
28	2Q 2009 results at Financial Services Revenue (8.4%) to $673.8 million S&P Credit Market Services: (9.9%) to $457.4 million S&P Investment Services: (4.9%) to $216.4 million Operating Profit (8.8%) to $276.4 million Includes pre-tax loss of $13.8 million from divestiture of Vista Research and a pre-tax net benefit of $0.4 million from restructuring charges Operating Margin 41.0%
29	Key takeaways from Financial Services’ 2Q 2009 results Comparisons especially challenging 2Q 2008 was biggest revenue and profit producer for the segment last year Signs of a thaw in credit markets Banks’ increased activity to issue debt without government guarantees 1Q: Guaranteed debt was more than 80% of financial sector issuance 2Q: Guaranteed debt fell to less than 50%
30	Signs of a thaw in credit markets Renewed ability to attract capital from private sector as capital base of banks improve Liquidity has improved Banks’ decreasing demand for short-term funding from Fed programs Sharp drop in LIBOR Spread between three-month LIBOR and Fed’s overnight rate is down to approximately 0.4%
31	Signs of a thaw in credit markets Greater willingness of investors to take on some risk Trend contributed to 82.6% increase in U.S. speculative-grade issuance in 2Q 2009 Issuance was used to refinance bonds and loans Significant need remains for speculative-grade companies to raise cash, especially those looking to shift debt from short-term loans into longer-term maturities
32	2Q new dollar volume issuance Industrial sector issuance increased in 2Q Up 2.1% in U.S. and 34.8% in Europe Why issuers have turned to public markets: Avoid refinancing risks over next 18 months Low short-term interest rates and aversion to equity and structured finance have channeled investors toward industrial bonds
33	2Q new dollar volume issuance Structured finance market declined in U.S. and in Europe Significant impact of corporate activity on S&P Credit Market Services’ transaction revenue Up compared to 1Q 2009, but down year-over-year 31.6% increase compared to 1Q 2009 21.6% decrease compared to 2Q 2008—the biggest quarter of 2008
34	Outlook for structured finance remains uncertain Residential mortgage-backed securities (RMBS) U.S. market has benefited in short-term from increased re-REMIC issuance Longer-term outlook depends upon recovery in housing market Majority of European structured finance transaction revenue is derived from government and central bank liquidity programs U.S. and European commercial mortgage-backed securities and collateralized debt obligation markets Very little new issuance Very low trading volume in secondary markets
35	Outlook for asset-backed securities market TALF (Term Asset-Backed Securities Loan Facility) stimulated new activity in U.S. ABS market 2Q 2009: New issuance declined 25.8% year-over-year Substantial tightening of spreads since beginning of 2009 in three consumer asset classes: Autos Credit cards Student loans We anticipate a further recovery in ABS sector
36	Improving our forecast for 2009 transaction revenue Encouraging new activity in bond market Continuation will favorably impact transaction revenue in second half 2009 as year-over-year comparisons get easier
37	Easier comparisons in second half vs. 2008
38	Easier comparisons in second half vs. 2008
39	Improving our forecast for 2009 transaction revenue Now expect mid single-digit decline in transaction revenue for 2009 Compares to previous forecast of a 10% to 12% decline
40	Outlook for non-transaction revenue Non-transaction revenue off 3.1% in 2Q 2009 Reduction in fees earned for work on canceled transactions (breakage fees) Impact of foreign exchange Non-transaction revenue is a resilient source of S&P Credit Market Services’ revenue 2Q 2009: 67.9% of CMS’ total revenue 1H 2009: 69.6% of CMS’ total revenue FY 2009: Continue to expect only a slight decline Reduced breakage fees in 2009 versus 2008, and impact from foreign exchange
41	Outlook for S&P Credit Market Services’ revenue International revenue declined in 2Q 2009 by $24.0 million Foreign exchange rates account for $21.0 million of the decrease but will be less of a factor in 2H 2009 FY 2009: We continue to expect low single-digit revenue decline in S&P CMS’ revenue
42	Near-term outlook mixed for S&P Investment Services 2Q 2009: Revenue declined 4.9% FY 2009: Now expect low single-digit decrease for the year Factors contributing to revised outlook Sale of Vista Research in May Settlement contracts with investment banks for S&P’s equity research products expire at end of July Nine firms purchasing research from S&P; will retain some of these clients Signed new agreement with Citibank; more in the works
43	Outlook for index services Index services declined in 2Q, primarily driven by: Reduction in asset-based fees from exchange-traded funds Drop in over-the-counter derivative trades linked to various S&P indices Assets under management in exchange-traded funds fell by 8.0% to $189.8 billion versus same period last year Sequential improvement over 1Q 2009, which ended at $158.6 billion
44	Finding new ways to grow index business Increased sales of data and growth in custom index business in 2Q Launched eleven new exchange-traded funds based on S&P indices in 2Q 2009 Now 209 exchange-traded funds based on S&P indices More in the pipeline
45	Data and information benefiting Investment Services Capital IQ added customers in 2Q Now serves over 2,800 clients An increase of 5.2% since end of 2008 Expanded overseas and benefited from international growth in second quarter
46	The regulatory outlook: Creating a global framework Ongoing dialogue with policymakers, regulators, and market participants U.S.: Working with SEC, White House, Treasury Department and Congress on proposed new legislation Europe: Working with CESR, European Commission, and others; will continue to work with IOSCO Reaching out to regulators and policymakers in Japan, Australia, and Canada
47	S&P’s initiatives complement proposed new regulations Focused on four key areas: Quality Prevention of conflicts Increased transparency Accountability
48	S&P’s global outreach S&P’s commitment to reform Addresses changes S&P has made in its businesses in the last two years Appeared in Financial Times, The Wall Street Journal, The New York Times, and The Washington Post Full text at www.standardandpoors.com
49	Timeline on new regulatory framework remains fluid U.S. legislative process may be completed by end of 2009 Depending on congressional priorities, could finish in 2010 Europe: Expect new European Union legislation on credit rating agencies to be formally adopted this fall Effective date for rating agencies to be in compliance expected by mid-2010
50	S&P Credit Market Services is now subject to robust regulatory oversight Credit Rating Agency Reform Act of 2006 gave SEC significant regulatory authority In early 2009, new wide-ranging SEC rules took effect, including: Measures related to disclosure and management of potential conflicts related to issuer-pay model Ban on certain conduct involving gifts and fee discussions with analysts Increased record-keeping requirements for material deviations assigned from model outputs and complaints about analysts’ performance More rules may be coming according to SEC
51	Accountability: The marketplace, the SEC, and private litigation Daily accountability is most important check on our ratings business Accountable to SEC and subject to private litigation S&P can be sued for securities fraud, like all other participants in the financial markets Courts have recognized that ratings opinions are entitled to First Amendment protection against certain claims, but there is no exemption from potential liability for intentionally misleading or defrauding investors
52	The legal outlook: Setting the record straight S&P not immune from litigation or legal liability Always subject to potential liability under fraud provisions of federal securities law Critics’ comments on immunity and liability do not match the facts
53	Latest developments on litigation front New CALPERS lawsuit: Purchased without due diligence $1.3 billion of securities based solely on ratings opinions issued by S&P, Moody’s and Fitch S&P’s clear and long standing public disclosure: A rating is not a recommendation to buy, sell, or hold We think the lawsuit is without merit and intend to defend against it vigorously
54	2009 outlook for Financial Services Summary Slight decline in revenue Margin decline of 225 to 275 basis points, excluding 2008 and 2009 restructuring charges and the loss on Vista Research Low single-digit growth in expenses Implied operating margin of approximately 39%
55	McGraw-Hill Education Financial Services Information & Media
56	Information & Media: 2Q 2009 results Continuing weakness in the advertising market a key factor in 2Q
57	2Q 2009 segment results at Information & Media Revenue (11.5%) to $236.2 million Broadcasting Group: (23.1%) to $20.4 million Business-to-Business Group: (10.2%) to $215.8 million Operating Profit (41.8%) to $14.4 million Includes a net pre-tax restructuring charge of $4.0 million Operating Margin 6.1%
58	Factors influencing 2Q results Broadcasting: Declines in national and local time sales Softness in auto advertising a contributor Absence of political advertising a factor in 2009 Print advertising soft in Business-to-Business Group Includes publications in construction and aviation markets BusinessWeek ad pages down 34.3% in second quarter, according to Publishers Information Bureau
59	Factors influencing 2Q results Platts: Volatility contributes to strong performance Oil prices have more than doubled since hitting low of $33.98 a barrel in February Platts is growing in the petroleum, natural gas, nuclear and metals markets
60	Outlook for 2009: Information & Media Summary: Revenue: Now expect 8% to 9% decline in view of continued weakness in advertising Versus previous guidance of 5% to 6% decline Operating margin: Now expect 300 to 400 basis point decline, excluding 2008 and 2009 restructuring charges
61	Outlook for 2009: The McGraw-Hill Companies Summary: Revenue to decline 5.5% to 6.5% versus previous guidance of 4% to 5% decrease Excluding second quarter restructuring charge and divestiture of Vista, earnings per share of $2.20 to $2.25, although it appears we will come in at low end of range
62	Robert J. Bahash Executive Vice President and Chief Financial Officer The McGraw-Hill Companies
63	Second half is key to 2009 performance Factors influencing second half results Seasonality of education business 3Q is biggest earnings contributor each year Expect revenue’s rate of decline to diminish Off 9.6% in first half Minimal growth in expenses Down 7.1% in first half For full year, consolidated expenses expected to decline in low single-digit range, excluding restructuring charges in 2008 and 2009 and the loss on the divestiture of Vista Research in 2009
64	Key takeaways for 2009 Revenue decline in first half mitigated by stringent expense controls No let up in 2H 2009 Company’s financial position will remain strong Our actions leave us well positioned when economic conditions improve
65	Realizing the benefits of restructuring 2Q restructuring charge of $24.3 million relating to reduction of approximately 550 positions Partially offset by reversal of $9.1 million related to prior restructuring initiatives, for a net charge of $15.2 million pre-tax, or approximately $0.03 per diluted share of 2Q EPS Cost benefits of combining McGraw-Hill Education’s operations will be largely realized in 2010
66	Key factors in the restructuring reversal Reversal of $9.1 million for prior restructuring initiatives is primarily due to two factors: Although positions were eliminated, we were able to place affected employees in faster growing businesses Lower than anticipated severance payments Most pronounced at international locations where country rules made estimating severance challenging; our estimates turned out to be conservative
67	Foreign exchange rates: A factor all year Reduced revenue significantly in first half 2Q: Reduced revenue by $37.2 million, or 220 basis points 1H: Reduced revenue by $74.6 million, or 260 basis points Based on current rates, we anticipate less impact on revenue in 2H 2009
68	Measuring impact of foreign exchange on expenses Foreign exchange reduced segment expenses, as reported 2Q 2009: $32.4 million reduction 1H 2009: $82.0 million reduction In constant currency, segment expenses declined less than reported results (excluding restructuring charges in 2008 and 2009 and the loss on the divestiture of Vista Research) 2Q 2009: Would have declined 7.6% vs. reported 10.1% decline 1H 2009: Would have declined 3.8% vs. reported 7.4% decline Based on current rates, we anticipate the impact on expenses to lessen in second half of 2009
69	Measuring impact of foreign exchange on operating profit Benefited operating profit by $7.3 million in 1H 2009 Why different top and bottom line outcomes Revenue: Billings are primarily in Euros and U.S. dollars Costs: Significant expenses are denominated in non-U.S. dollars
70	Measuring the impact of incentive compensation Changing levels of incentive compensation were a factor in first half; will be more significant in second half 2Q 2009 benefited from $23 million decline for operating segments and corporate 1H 2009 benefited by approximately $29 million Expect full year incentive compensation to increase $90 million compared to 2008 Previously forecasted $110 million increase Implies a $119 million increase in second half 2009 compared to 2H 2008 when we reduced long-term and short-term accruals, particularly in 3Q 2008 Resulted in a negative $39 million in stock-based compensation in 3Q 2008
71	Benefits of cost containment at McGraw-Hill Education 2009 outlook for McGraw-Hill Education Revenue: Now expected to decline 8.5% to 9.5% versus previous guidance of a 7% to 8% decrease Expenses: Anticipate a mid single-digit decline versus previous estimate of a low single-digit decline Maintaining previous margin guidance of 300 to 400 basis point decline, excluding 2008 and 2009 restructuring charges
72	Benefits of cost containment at McGraw-Hill Education Lower expenses at McGraw-Hill Education 2Q 2009: Down 11.7% year-over-year 1H 2009: Down 10.0% year-over-year In constant currency, first half expenses down 7.1%, benefiting from: 2007 and 2008 restructuring actions Lower cost of goods sold Lower sales and marketing costs, which in some cases will shift to 3Q 2009
73	2009 outlook for Financial Services S&P Credit Market Services transaction revenue 1H 2009: Down 20% 2H 2009: Expect strong growth as comparisons get easier due to depressed issuance in 2008 S&P Credit Market Services non-transaction revenue 1Q 2009: $280 million 2Q 2009: $311 million Reasons for sequential increase: 1Q 2009 was $22 million lower than 4Q 2008 Timing of renewals for certain contracts
74	Benefits of cost containment at Financial Services Margins now expected to decline 225 to 275 basis points versus previous guidance of a 250 to 300 basis point decline Implies low single-digit increase in expenses and a modest improvement from our previous guidance
75	Benefits of cost containment at Financial Services 2Q 2009: Expenses down 8.0% excluding restructuring charges in 2008 and 2009 and the loss on the divestiture of Vista Research In constant currency, 2Q expenses down $15.2 million, or 3.6% Decrease primarily driven by reduced incentive compensation and restructuring benefits Also benefited from divestiture of Vista Research and CRISIL Gas Strategies 1H 2009: Expenses down 4.4% In constant currency, first half expenses up 1.3% 2H 2009 comparisons more difficult given increased incentive compensation and reduced impact of foreign exchange Will be partially offset by benefits of restructuring actions
76	2009 outlook for Information & Media 2009 revenue and profits adversely impacted by non-cash accounting, a result of converting J.D. Power’s studies onto new online Compass platform FY 2009: Now expect a $12 million decrease in revenue and a $7 million decrease in profit Compares to previous guidance of $15 million decrease in revenue and $10 million decrease in profit Revised estimate is due to changes in scope and timing of conversions 2Q 2009: $3.4 million decrease in revenue and a $2.9 million decrease in profit 1H 2009: $8.1 million decrease in revenue and a $5.2 million decrease in profit
77	2009 outlook for Information & Media Lowering guidance for operating margin Additional revenue decline partially mitigated by continued cost containment initiatives Forecasting a 300 to 400 basis point decline versus earlier guidance of a 200 to 300 basis point decline, excluding 2008 and 2009 restructuring charges Expenses: Mid single-digit decline versus previous guidance of low single-digit decline
78	2009 outlook for corporate expenses 2Q 2009: $29.3 million, a $4.2 million decline compared to same period last year Largely due to reduced stock-based compensation 2009: Continue to expect an increase of $25 million to $30 million compared to 2008 Largely reflects increased stock-based and short-term incentive compensation Second half comparisons will be challenging, particularly in 3Q
79	Changes in the effective tax rate for 2009 2Q 2009: 36.4% versus 37.0% in 2Q 2008 2009: Expect the full-year tax rate to be 36.4% An approximate 60 basis point decline from 2008
80	2009 guidance for free cash flow Pension contribution of about $25 million is planned in 3Q 2009 Incorporated into free cash flow projections 2009: Still expect free cash flow in $430 to $450 million range, though probably at low end of range Approximately equal to 2008, despite lower profits, due to continuing working capital improvements, focus on cost containment and prudent investments
81	2009 guidance for free cash flow 1H 2009: Free cash flow improved by $337 million versus 1H 2008, driven by: Significant reduction in incentive compensation payments Continuing working capital improvements, particularly for inventories and accounts receivable 2H 2009: More difficult comparisons given lower anticipated receipts
82	MHP’s debt position at end of 2Q Net debt: Ended 2Q at $731 million, down $130 million versus 1Q and down $65 million versus year-end 2008 We continue to have access to the commercial paper market at reasonable rates Gross debt: $1.3 billion at the end of 2Q $1.2 billion in unsecured senior notes $89.6 million in commercial paper outstanding Offset by $556.1 million in cash, primarily foreign holdings First long-term debt payment not due until 2012
83	Diluted weighted average shares outstanding (WASO) 2Q 2009: 313.0 million shares 8.1 million share decrease compared to 2Q 2008 Primarily due to 2008 share repurchases and to lesser extent, decline in our stock price Roughly flat compared to 1Q 2009 Fully-diluted shares at end of 2Q 2009: Approximately 313 million shares
84	Outlook for net interest expense 2Q 2009: $18.5 million net interest expense A $1.9 million decline from 2Q 2008 2009: Still expect interest expense to be roughly comparable to 2008
85	Outlook for prepublication investments in 2009 2Q 2009: $42.3 million, down $22.9 million compared to 2Q 2008 2009: Now expect approximately $200 million, down from previous guidance of $225 million and $254 million invested in 2008 Factors for lower level: Reducing scope of some programs in current economic environment Change in timing of some programs Benefits of off-shoring and other efficiencies
86	Outlook for capital expenditures for property and equipment in 2009 2Q 2009: $8.9 million, compared to $25.2 million in same period last year Reflects year-over-year reductions in technology spend and real estate improvements 2009: Now expect $75 million to $80 million, versus previous estimate of $90 million
87	Outlook for non-cash items Amortization of prepublication costs 2Q 2009: $71 million, compared to $66 million in same period last year 2009: Continue to expect a range of $275 million to $280 million Compares to $270 million in 2008
88	Outlook for non-cash items Depreciation 2Q 2009: $28.8 million, $1.6 million lower than same period last year 2009: Still expect approximately $130 million
89	Outlook for non-cash items Amortization of intangibles 2Q 2009: $11.4 million, compared to $13.1 million for same period last year 2009: Now expect approximately $50 million, versus previous estimate of $55 million
90	Outlook for unearned revenue in 2009 End of 2Q 2009: $1.1 billion Roughly flat year-over-year and with 1Q 2009 In constant currency, grew 2.6% versus prior year Financial Services represents approximately 75% of MHP’s unearned revenue 2009: Still expect to grow slightly in 2009
91	2Q 2009 Earnings Call July 28, 2009 Presenters: Harold McGraw III Chairman, President and CEO Robert J. Bahash Executive Vice President and CFO Donald S. Rubin Senior Vice President, Investor Relations
92	2Q 2009 Earnings Call July 28, 2009 Replay Options Internet replay available for one year Go to www.mcgraw-hill.com/investor_relations Click on the Earnings Announcement link under Investor Presentation Webcasts Telephone replay available through August 27, 2009 Domestic: 866-419-8651 International: +1-203-369-0780 No password required